The Texas Rangers unveiled a $575 million plan on Monday aimed at quickly completing the Major League Baseball franchise’s sale to a group led by former Ranger pitcher Nolan Ryan through a prepackaged bankruptcy.
The ball club said the voluntary bankruptcy won’t impact normal baseball or business operations and Ryan, currently the team’s president, said he expects the sale to occur by mid-summer. Ryan’s investor group is also led by Pittsburgh attorney Chuck Greenberg.
Creditors, including former Ranger players Alex Rodriguez and Kevin Millwood, are expected to recover 100% of Rangers-related debt. The Rangers said they have between $100 million and $500 million of both assets and liabilities.
The two sides said the sale of the club and lease to Rangers Ballpark in Arlington, together with a separate sale of the land around the stadium, have a total value of about $575 million.
The Rangers requested a hearing in 45 days to confirm the proposed sale and plan of reorganization. Once the sale is completed and approved by the courts, the franchise can exit the Chapter 11 process.
Prepackaged bankruptcies allow for companies to receive debtor-in-possession financing ahead of time with the aim of emerging from bankruptcy faster than traditional Chapter 11 filings, while saving on accounting and legal fees.
MLB agreed to provide the Rangers with a new credit facility to ensure it meets all of its obligations.
“This plan to complete the sale of the Texas Rangers serves the best interests of the team, its fans, MLB and all other parties involved," Bud Selig, MLB commissioner, said in a statement. “Rangers fans can have confidence that their team has the resources it needs to compete.”
The current owners, led by Tom Hicks, will continue to have control of the franchise while the sale is being completed. The team said it will be able to operate within its existing budget to ensure it can sign and acquire players, keep ticket prices steady and pay salaries.
"Our goal is to move forward with our plan to create a long-term record of success and championships," said Ryan, who will continue to serve as Rangers president.
The two sides also announced a separate transaction where an independent investment vehicle controlled by Hicks will sell or transfer to the Ryan group about 153 acres of the 195 acres around the Rangers’ stadium and Cowboys Stadium in return for cash, notes and an ownership position in Rangers Baseball Express.